Hello Folks found this interesting article on internet do tell me whether it works or not.
This article will help you convert your Windows XP and Vista based laptop in a Wireless HotSpot. One you setup your laptop as HotSpot then you do not need a router, switch, hub, etc… to form a network, in fact other laptops or PC’s can connect or access the internet through this newly created HotSpot

What do I need to set a HotSpot?

1. Active Cable Internet
2. Laptop
3. WiFi on Laptop
4. Wired net connection

Once you have all the above things mentioned, you are all set to follow the steps:

How to setup HotSpot on Windows Vista:

1. Got to Control Panel
2. Click on “Network and Sharing Centre”
3. Under Tasks choose “Setup New Connection”
4. Wireless “Ad-hoc network”
5. Now type in a “Network Name”
6. Choose “WEP” password if you don’t want to share the connection with the entire world
7. Click “Internet connection sharing”
8. Done!

Now a WiFi enabled machine will be able to connect to the network you have just setup with the WEP password

Lets setup a HotSpot on a Windows XP machine:

1. Go into Control panel
2. Open “Network Connections”
3. Right click on "Wireless Connection" and click on "Properties"
4. Click on the "Wireless Networks" tab and select the check-box which says “Use Windows to configure my wireless network settings”
5. Under “Prefered networks” click “Add”
6. Type a name in “Network name” text box
7. Select “Shared” from the options under “Network Authentication”
8. Under Data encryption select “WEP” and type in your password in “Network Key” field and now click "OK"
9. Now the new HotSpot should show in the list of preferred networks.
10. Click on the “Advance” button and select “Computer-to-computer (ad hoc) networks only" and press close
11. Hit “OK”, we are done with the wireless connection properties

One more step, we have to change something in the wired connection setting so that it knows that it has to share connection with the computers accessing our HotSpot.

1. Go to local Area Connections, right click it and select properties
2. Go to the “Advanced” tab and under Internet Connection Sharing check the box which says “Allow other network users to connect through this computer’s internet connection” and make sure the box under that is NOT selected so that no one can disable the network remotely.
3. Hit “OK”

I hope this helps setting up a wireless connection without a WiFi router. Have FuN!